Dubai Court Approves Cryptocurrency Salaries
YEREVAN (CoinChapter.com) — The Dubai Court of First Instance has ruled that paying salaries in cryptocurrency is approved under UAE law. The decision from case number 1739 in 2024 marks a change in how the court views digital payments in employment contracts. This follows a 2023 case where the court dismissed a similar claim due to a lack of clear valuation for the cryptocurrency involved.
Crypto Salary Verdict. Source: DeFi Sword Crypto Wages Upheld in Landmark 2024 Ruling
The 2024 case involved an employee who sued for unpaid wages and wrongful termination. The employment contract included a monthly salary in fiat currency and 5,250 EcoWatt tokens. The employer failed to pay the tokens for six months, leading to the lawsuit. Unlike the 2023 ruling, the court upheld the payment in cryptocurrency without requiring conversion to fiat. The court based its decision on Article 912 of the UAE Civil Transactions Law, which governs wage payments.
Irina Heaver, a partner at NeosLegal, explained that this ruling shows a shift from the court’s previous stance. In 2023, the court required a clear fiat valuation for digital payments, which the employee failed to provide. The 2024 ruling, however, recognized the cryptocurrency payment as valid under the employment contract.
Dubai Court Validates Crypto Salaries, Setting Precedent for UAE Businesses
The ruling has important implications for both employers and employees. Employers must honor the terms of contracts that include cryptocurrency payments. The court’s decision confirms that digital currencies like EcoWatt tokens are valid forms of salary payment. This ruling may lead to more companies considering cryptocurrency as part of employee compensation.
Irina Heaver noted that the court applied the UAE Civil Transactions Law and Federal Decree-Law No. 33 of 2021 in both the 2023 and 2024 rulings. This consistent application of legal principles provides clarity for businesses and employees regarding cryptocurrency payments in the UAE.
Legal Milestone for Crypto in UAE. Source: DeFi Sword Saint
With over 3,000 cryptocurrency companies operating in the UAE, employing thousands of people, this ruling provides legal clarity for employees who receive cryptocurrency as part of their wages.
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